BOSTON–A new survey offers insights into how many consumers have had their financial data breached, what consumers think of biometrics, and where there may be a “blind spot” among financial executives.
“Multi-faceted biometric applications will soon be the norm, putting an end to password-only,” according to GlobalData, a data and analytics company that conducted the survey.
But Heike van den Hoevel, senior wealth management analyst with GlobalData, added a caveat that “while industry experts agree that the application of biometrics has the potential to tackle fraud more effectively than ever before, more has to be done to roll it out to different aspects of a banks’ operations.”
GlobalData said its 2018 Consumer Payments Insight Survey found 16% of consumers globally, have been victims of payment fraud over the past four years. Not counting the reputational damage providers suffer as a result, this is costing the industry billions every year, the company noted.
“Of those consumers who have been subject to fraud, 9% closed their accounts and switched to another provider,” said van den Hoevel. “Given the costs involved in acquiring and retaining customers, this is a significant proportion. Yet, the level of concern from financial services providers remains low.”
The Blind Spot
van den Hoevel said that finding is particularly true in the wealth management and private banking space, where there are the highest-value transactions, and hence the highest risk of fraud and reputational damage. Only 34% of providers regard the effect of data breaches on their company's brand as a threat, suggesting a “blind spot” in executive thinking
Biometrics are set to replace or supplement pin codes and passwords and according to the GlobalData study, 67% of global consumers said they would be happy to use some form of biometric to secure their payment details. That figure can rise as high as 93% among banking customers if rolled out properly, according to the company.
“Banks often worry about the balancing act of extra security and maximizing convenience, but clearly there are solutions such as biometric security that can address both. It’s time to act, or be left behind,” said van den Hoevel.